bank of lithuania

The Bank of Lithuania: Steering the Fintech Revolution

At the heart of Lithuania’s thriving fintech environment stands the Bank of Lithuania. This institution has significantly influenced the country’s fintech trajectory, from nurturing startups to shaping regulatory policies.

Lithuania’s fintech success doesn’t only stem from its regulatory framework but also from the government’s encouragement, laws, and the expertise of its workforce. These factors have collectively positioned Lithuania prominently on the European fintech map.

Bank of Lithuania – The Regulatory Environment

The Bank of Lithuania has been instrumental in crafting a regulatory atmosphere that bolsters innovation while maintaining the integrity of the Lithuanian financial system. This balance has given fintech firms a clear roadmap for growth. Key to this is the swift licensing mechanism, clear regulations, innovative and friendly approach by the Bank of Lithuania, which not only accelerates startups’ market entry but also opens the door to the broader European market.

The Bank’s innovative regulatory sandbox is another noteworthy initiative, offering fintech firms a safe environment to pilot their solutions, getting first hand feedback from authorities, and refining offerings before a full-scale launch.

A Glimpse Back in Time

The Bank of Lithuania has played a crucial role in steering the fintech revolution in Lithuania. Established in 1922, shortly after the country gained independence, the bank has been instrumental in stabilizing the financial system and supporting economic growth. 

In the 1990s, Lithuania transitioned to a market economy, and the Bank of Lithuania played a vital role in implementing reforms to modernize the financial system and prepare the country for EU membership. 

Becoming a member of the European system in 2004 profoundly impacted the fintech sector in Lithuania, as it provided access to the single market and allowed fintech companies to rapidly scale their businesses.

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Bank of Lithuania’s Central Role

The Bank of Lithuania isn’t just a regulatory body; it’s the heart of Lithuania’s financial system. From setting monetary policies, ensuring financial resilience, to safeguarding consumers and consulting fintech companies, its responsibilities are vast.

In the context of Lithuania’s fintech ecosystem, the Bank of Lithuania plays a vital role in fintech regulation. It offers a range of fintech licenses, including Electronic Money Institution (EMI) License, Payment Institution (PI) License and Specialized Bank License. 

It has also established a regulatory sandbox, open banking framework, and public education campaigns to support and nurture fintech innovation in Lithuania.

Additionally, the Bank of Lithuania has a Newcomer’s program, during which new market participant EMI, PI, Crowdfunding platform or any other licensed subject presents its business plan to the Bank of Lithuania prior to the application stage. Respectively, the Bank of Lithuania provides initial feedback on the business plan, financial projections, organizational structure and etc. Such face-to-face meeting with the Bank of Lithuania not only allows to get familiar with the Bank of Lithuania’s representatives, but also gather initial professional feedback on the application documents and business plan to ensure a smooth and successful licensing process. 

Through these initiatives, the Bank of Lithuania is steering the Fintech revolution in the Lithuania, ensuring a progressive regulatory environment and fostering the growth of the fintech sector.

Fintech Licensing – The Role of Central Bank

role of central bank in fintech licensing

As the central bank of the Republic of Lithuania, the Bank of Lithuania plays a crucial role in the fintech revolution by offering a streamlined and efficient fintech licensing system. The Bank of Lithuania’s fintech licensing system is known for its efficiency and effectiveness, making it an attractive destination for fintech companies seeking to expand their operations.

The lithuanian fintech licensing process has several notable features:

  • Electronic Money Institution (EMI) License: This license allows companies to issue e-money and provide related services such as payment processing and money transfers.
  • Payment Institution (PI) License: This license enables companies to offer payment services, such as processing card payments and issuing payment instruments.
  • Specialized Bank License: This license is specifically designed for fintech companies that wish to provide banking services, including deposits, loans, and investment products.
  • Crowdfunding License: Gaining traction, this license permits companies to facilitate collective fund-raising from the public, typically via online platforms.
  • Financial Brokerage License: Also on the rise, this license allows companies to act as intermediaries in financial transactions, connecting buyers and sellers.
  • Access to the EU Single Market: Obtaining a fintech license in Lithuania allows companies to operate in all 27 EU member states without requiring additional licenses.
  • Supportive Regulatory Environment: Lithuania provides a regulatory framework that encourages innovation and fosters fintech growth. Also, a lot of investors come to Lithuania to open the Fintech company since the Bank of Lithuania allows it to connect to the CENTROlink Payment System.

Regulatory Sandbox of the Bank of Lithuania

The Bank of Lithuania’s regulatory sandbox provides fintech firms a controlled arena to test their innovations. This setup is beneficial for both the businesses and regulators. 

For fintech entities, this sandbox serves as a secure platform to trial and tweak their offerings, ensuring they align with regulations before a full-scale launch, thus saving on time and compliance costs. 

On the regulator’s side, it offers a firsthand look into upcoming technologies, enabling them to weigh risks and craft the right regulations. 

However, the sandbox isn’t without challenges. Balancing innovation with consumer safety is paramount, and it’s essential to ensure a fair playing field, avoiding any undue advantages or stifling competition.

Open Banking

Open banking in Lithuania represents a modern approach to financial services, aligning with the global trend towards more integrated and user-friendly financial experiences. This initiative encourages a secure method for sharing financial information, aiming to foster innovation, competition, and efficiency in the banking and fintech sectors.

How can open banking revolutionize the financial services industry in Lithuania?

Open banking has the potential to bring about significant benefits and opportunities for both consumers and businesses in Lithuania. Here are some ways in which open banking can make a positive impact:

  • Increased competition and innovation: Open banking allows for the development of new and innovative financial products and services, leading to increased competition among financial institutions and fintech companies.
  • Enhanced customer experience: Open banking enables consumers to have better control over their financial data and access personalized financial services that meet their specific needs.
  • Streamlined financial management: Open banking allows for the aggregation of financial data from multiple accounts and institutions, making it easier for consumers to manage their finances and make informed decisions.
  • Greater financial inclusion: Open banking can help to bridge the gap between traditional banking services and underserved populations, providing access to financial services for those who may have been excluded in the past.
  • Collaboration and partnerships: Open banking encourages collaboration and partnerships between traditional financial institutions and fintech companies, fostering innovation and driving the growth of the fintech ecosystem in Lithuania.

Open banking in Lithuania offers many advantages but also faces hurdles like data security concerns, the need for standardized APIs, and regulatory complexities. Yet, with proper frameworks and collaboration, it holds the promise of transforming the country’s financial services sector, making it more efficient and user-focused.

Blockchain & Cryptocurrencies – Treading Carefully

blockchain and cryptocurrencies

Blockchain technology and cryptocurrencies have emerged as key players in the fintech revolution in Lithuania. The Bank of Lithuania recognizes the potential of blockchain technology to transform the financial sector. It has been proactive in promoting blockchain applications, such as smart contracts and decentralized finance, which can improve transparency, efficiency, and security in financial transactions.

However, the Bank of Lithuania is also aware of the risks associated with cryptocurrencies. To protect consumers and ensure financial stability, it has issued guidelines on cryptocurrency regulations. Nevertheless, due to the innovative approach of the Bank of Lithuania new financial market participants or fintech companies may include crypto services to their offerings and create crypto-fiat gateway. However, in order to provide crypto related services, businesses have to obtain additional required authorizations (crypto licenses) with local authorities. 

After the Markets in Crypto Assets (MiCA) will come into the force, the Bank of Lithuania will be main supervisory authority for the VASP / CASP licensing processes, since MiCA establishes new licensing procedure for  cryptocurrency exchanges, cryptocurrency wallets and other crypto service providers. 

Protecting Consumers – A Top Priority

To ensure the safety and well-being of consumers, the Bank of Lithuania prioritizes consumer protection in the fintech industry. The bank takes several measures to protect consumers in the fintech age, including:

  • Licensing and supervising fintech companies.
  • Consulting and advising fintech companies. 
  • Conducting public education campaigns to raise awareness of fintech risks.
  • Providing a complaint resolution mechanism for consumers who’ve problems with fintech companies.
  • Requiring fintech companies to comply with data protection and security regulations.

Consumer education and advisory is a key aspect of the Bank of Lithuania’s consumer protection efforts. By educating consumers and advising fintechs about the risks and benefits of fintech, the bank aims to empower them to make informed financial decisions.

The bank also ensures that fintech companies adhere to data protection regulations to safeguard consumer information and prevent data breaches.

Through these initiatives, the Bank of Lithuania strives to create a secure and trustworthy environment for consumers in the fintech industry.

Notable Success Stories

Now let’s take a look at some notable success stories in the fintech industry in Lithuania.

One of the most prominent success stories in the fintech industry in Lithuania is Revolut. With its headquarters in Vilnius, Lithuania, Revolut has had a significant impact on the fintech landscape. Offering mobile banking, currency exchange, and investments, Revolut has amassed over 15 million customers in more than 200 countries. This success not only demonstrates the potential of fintech in Lithuania but also highlights the country’s strong fintech talent pool.

In addition to Revolut, other notable fintech companies in Lithuania include NordVPN, a cybersecurity company offering VPN services, Paysera, a financial technology company providing payment processing and other financial services, and TransferGo, a money transfer company enabling users to send money to over 150 countries.

These success stories showcase Lithuania’s position as a thriving fintech hub with a diverse range of innovative companies.

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Working Together – The Collaborative Spirit

The Bank of Lithuania actively collaborates with various stakeholders to foster fintech innovation in Lithuania. This collaborative approach is crucial for creating a supportive ecosystem that drives the growth of the fintech sector.

Some of the key collaborations and partnerships that the Bank of Lithuania engages in include:

  • Invest Lithuania: The Bank of Lithuania works closely with Invest Lithuania, a government agency that promotes foreign investment in Lithuania. This partnership helps attract global fintech companies to establish their presence in Lithuania, contributing to the growth of the sector.
  • Lithuania Fintech Association: The Bank of Lithuania collaborates with the Lithuania Fintech Association, a trade association representing the fintech sector in Lithuania. This partnership facilitates knowledge sharing, advocacy for favorable regulations, and the development of industry best practices. For more details check out more on Crypto Economy Organization (CEO)
  • EU fintech organizations: The Bank of Lithuania actively engages with other EU regulators and fintech organizations to develop harmonized fintech regulations. This collaboration ensures a consistent regulatory framework across the EU, fostering innovation and enabling fintech companies to operate seamlessly across borders.
  • Public-private collaborations: The Bank of Lithuania promotes collaborations between the public and private sectors to drive fintech innovation. By partnering with industry players, academia, and government agencies, the Bank of Lithuania creates an environment that encourages innovation, knowledge exchange, and the development of cutting-edge solutions.
  • International collaborations: The Bank of Lithuania actively collaborates with international organizations and institutions to strengthen the fintech ecosystem. This includes partnerships with global central banks, financial regulators, and fintech hubs, facilitating information sharing, research, and joint initiatives.

These collaborations and partnerships play a vital role in fostering innovation, attracting investments, and creating a conducive environment for the long-term growth of the fintech sector in Lithuania. By working together, stakeholders can leverage their collective strengths and expertise to drive the fintech revolution forward.

Future Outlook

Looking ahead, you can expect the Bank of Lithuania to continue driving the fintech revolution in Lithuania with its forward-thinking approach and commitment to innovation. The future outlook for the fintech ecosystem in Lithuania is promising, thanks to the strong government support and the proactive role played by the Bank of Lithuania.

Here are some key points to consider:

  • Continued regulatory support and a progressive environment for fintech companies to thrive.
  • The development of a robust fintech infrastructure, including the promotion of banking APIs and other technologies.
  • Collaboration with stakeholders such as Invest Lithuania and the Lithuania Fintech Association to foster innovation and attract foreign investment.
  • The adoption of emerging technologies like blockchain to further enhance the fintech ecosystem.
  • Ongoing efforts to ensure consumer protection through licensing, public education campaigns, and compliance with data protection and security regulations.

With these initiatives in place, the Bank of Lithuania is well-positioned to steer the fintech revolution and propel Lithuania’s position as a leading fintech hub in the European central.


The Bank of Lithuania has played a crucial role in steering the fintech revolution in Lithuania.

Through its progressive regulatory environment, streamlined licensing system, and supportive initiatives like the regulatory sandbox, open banking framework and CENTROlink access, the Bank has created an environment that fosters innovation and attracts fintech companies.

With its forward-thinking approach and commitment to consumer protection, Lithuania has established itself as a leading fintech hub in Europe, and The Bank of Lithuania remains a pivotal force for future success, taking on a prominent role within the European system of central banks.